New For-Profit College Lobbyist Is Long-Time Champion of Troubling Policies

The nation’s major for-profit colleges show no sign that they are ready to accept the inevitable: that in a time of enormous budget pressures, they cannot continue to siphon off 32 billion dollars a year in federal student aid for high-priced, low-quality programs that often leave students without jobs and deep in debt. They show no sign of agreeing to reasonable rules that would bar deceptive marketing and recruiting and cut off aid to college programs that are failing students. Instead, the for-profit colleges continue to reserve a big chunk of their profits to relentless lobbying and lawyering to protect their appalling windfall at the expense of students and taxpayers.

Steve Gunderson, the former Republican congressman from Wisconsin who since February has headed APSCU, the for-profit college’s lobby group, seems like a nice guy. His arrival was greeted by suggestions of a kinder, gentler era for the association and its members, who had deployed a vicious derecho of high-priced lobbyists to thwart common sense accountability rules proposed by the Obama Administration. But Gunderson, who seems to have lost his last association job and surely is under strong pressure from the arrogant CEOs on his board of directors, has manned up.

He has sought to make Terry Hartle, chief Washington lobbyist for America’s traditional colleges, his new best friend, looking for common ground against regulation. He denounced President Obama’s initiative to protect America’s troops and veterans from fraudulent practices by for-profits as “deeply unfortunate.” He has continued to use our tax money for expensive lawyers who use tricky arguments to derail and delay the Obama Administration’s rules. And, to attendees at APSCU’s recent convention in Las Vegas, he made the ridiculous and inflammatory assertion that critics of the industry are driven by “their political or ideological agenda.”

And now the top aide that Gunderson inherited, Executive Vice President & Legal Counsel Brian Moran has “submitted his resignation” and will be replaced by Sally Stroup. Republic Report firmly believed that Moran’s duel roles as APSCU lobbyist and chairman of the Virginia Democratic Party represented an unacceptable conflict of interest, but his replacement presents a new set of troubling issues.

While Brian Moran came to the job with little background in federal higher education policy, Stroup is a long-time specialist in the field — with a subspecialty in promoting the interests of private companies that seek excessive compensation from taxpayers while performing poorly for students.

As a senior Republican staffer on Capitol Hill in the 1990’s, Sally Stroup allegedly worked to block an effort by the Clinton Administration to end loopholes that allowed banks to inappropriately inflate the enormous subsidies they received for issuing federal student loans. Stroup then became a lobbyist for the largest for-profit college, the University of Phoenix. When Stroup subsequently served George W. Bush as Assistant Secretary of Education, her department made the decision to gut enforcement of rules to prevent abusive recruiting practices by for-profit colleges. Most recently, Stroup has been senior vice president at Scantron, the educational testing company that profits handsomely from the endless test-taking required by Bush’s No Child Left Behind law. Scantron was, until recently, a member of the controversial corporate front organization ALEC. APSCU remains a member.

Stroup is considered a strong manager, and she reportedly retains strong ties to some career staff at the Department of Education. With APSCU now boasting an all-GOP leadership team, the industry seems to be betting on a Romney victory, or, failing that, a strategy of blocking reforms through deepening ties with the Hill Republican leadership. With so much money available for lobbying, advertising, and campaign contributions, the for-profit college industry is not giving an inch. Advocates for students and taxpayers have made great strides in recent years toward bringing real reform. They need to redouble their efforts to persuade the sector that its only chance to succeed is to change its business model and compete to actually prepare students for careers, rather than continuing to deceive and abuse.

Republic Report is dedicated to rooting out the corruption that is so corrosive to American values. We investigate and uncover the buying and selling of politicians and of institutions entrusted with upholding the public interest. We expose how big money distorts major policy decisions – harming our economy and our people.